9 ms·

It's very weird that Mozilla is laying off 25% of its workforce while at the same time spending oodles of cash on its Fix The Internet incubator. I'm not a bus

It's very weird that Mozilla is laying off 25% of its workforce while at the same time spending oodles of cash on its Fix The Internet incubator. I'm not a business major; maybe this is normal.

gkoberger 6y ago
I don't know the details, but the Mozilla Foundation and Mozilla Corporation have different budgets and legally have to spend the money on different things (since the Foundation is a non-profit). They can't just move money around like a normal company can.
- Wowfunhappy 6y ago
  Well... can they fix that? Please? At least for the future so this doesn't happen again? I'm not opposed to nonprofits creating systems to make sure donor money is handled appropriately, but it seems to me there's something seriously wrong with the current structure. In hard times, organizations generally need to focus on their core initiatives, not branch out even more!
  - dboreham 6y ago
    Probably would mean paying $$$ tax and/or returning money to whoever donated it.
- maxerickson 6y ago
  The corporation can spend money on whatever the hell. That's why they set it up. You can infer from the foundation tax returns that most of the assets are held by the corporation: https://assets.mozilla.net/annualreport/2018/mozilla-2018-form-990.pdf https://assets.mozilla.net/annualreport/2018/mozilla-2018-fo... It's the assets held directly by the foundation that have implications for their tax status, and they only move assets to that status as necessary.
  - viro 6y ago
    "The corporation can spend money on whatever the hell. That's why they set it up." oh that is not true at all ... fiduciary duty doesn't work like that.
    - maxerickson 6y ago
      There's no need to be so literal. And conveniently, the people directing the Corp are the ones setting the agenda for the org (which that agenda is the thing the Corp has a fiduciary duty towards...).
welfare 6y ago
As someone who's been involved in setting up a corporate incubator, this is a pretty common dilemma. The way that we viewed it at my previous company was basically it's two different businesses, two different P&L's and two different sets of metrics and KPIs. You could see them as two different business units that can succeed or fail independently. If one Business Unit is struggling, you can't just fill the holes by taking funds from another BU to fill the gap. You need to solve the inherent profitability problems in the struggling Business Unit in some other way, typically by selling more, increasing the price/mix or reducing the cost. Don't know if this is how Mozilla reasons, but this was definitely the way we reasoned in the last two large corporations I worked for.
- manquer 6y ago
  That doesn’t work in a non profit contexts . Most non profit missions are well, not profitable in the first place. While the Mozilla corporation is for profit entity , the goals of the foundation and reason Mozilla foundation /corporation exists is not to make or maximise profit . Non profits generally run on the principles of sustainability I.e are they spending more than endowments or they drawing on the principal amount etc. In Mozilla case drop in revenue/ donations resulting in cancelled projects is per se not abnormal , but which projects are shelved depends on how the mission is interpreted. It is perfectly within the foundation remit to infuse capital into the corporation if they had more money and they also believed the work of the corporation is more important than some foundation projects to the overall foundation’s mission. Just like NASA cancels other projects when one project like JWST goes a lot overbudget , with approvals from congress if required . Clearly the foundation did not think corporation projects were worth saying over others , we can debate that , but they did and do have that choice
NoInputSignal 6y ago
I remember reading another comment on HN somewhere that broke down how project costs are different from employee costs. Something to do with employees being recurring expenses vs projects being somewhat fixed....I'm not going to do it justice. If I find the comment I'll link to it.
rebelwebmaster 6y ago
If revenue from Firefox isn't enough to pay the bills anymore, then not funding R&D is cutting off your nose to spite your face.
- pbhjpbhj 6y ago
  'revenue' from Firefox was never enough. It's only really just struck me that of course Google funding them made a dependency and 1) made the company grow beyond its needs, and 2) made it not seek self-sufficiency. If Google are stopping the money then FF is like a person with no money taken in by Google and hooked on drugs; once they're kicked out they can't fund the habit and reliance on Google has meant they've not had to find ways to fund themselves. I realised Google held the cards, but hadn't twigged on how the excessive nature of the funding made Firefox/Mozilla weaker. Unless FF were aware of how that might go and put half of their Google money into investments?
  - tw1423214 6y ago
    It's not true that "'revenue' from Firefox was never enough", and it's bordering on misinformation to speculate that "Google are stopping the money". edit: Really, could you please not do that? Asking "Is the search deal not expiring?" is even worse than the earlier comment...
    - mulmen 6y ago
      Is the search deal not expiring? e: to your edit. I'm not sure what is wrong with the question. My understanding is that the search deal is expiring and is the source of most of the FF related revenue. If that is not the case I'd like to know. It seems like a reasonable question.
      - Arnavion 6y ago
        The search deal is indeed expiring in a few months, but also neither party has said whether it'll be renewed or not, so it's not yet time to assume it won't be.
deleted 6y ago
[deleted]
mathattack 6y ago
Different people. Fire one side to fund the other. Many companies use COVID as an excuse to get rid of management mistakes too.
- dylan604 6y ago
  Too bad it's not "mistakes in management" getting fixed instead
  - mathattack 6y ago
    Management can have high turnover too. Imagine trying to explain away being head of strategy at a company that drove into a ditch.
deleted 6y ago
[deleted]
behnamoh 6y ago
As a company, you know you're doing something wrong when websites such as this pop up on HN. I hope Mozilla is able to turn back to its origins.
- lmm 6y ago
  What origins? Was Mozilla ever a focused, well-run organisation?
blihp 6y ago
Fixing the browser revenue is at best difficult (i.e. significantly increase market share, more hard work to do on the browser which will cost $$$ for labor) while the Fix The Internet initiative could result in a miracle that saves them. Management often opts for for the miracle.
- jacquesm 6y ago
  Which then predictably doesn't happen and then we all get to buy Aeron chairs at a discount.
  - ThreeBadMoz 6y ago
    It's too bad all of us commenter's dick isn't getting sucked in this whole procedure; cannot catch them all.
dependenttypes 6y ago
Or spends 2.5m just for its CEO yearly (not to mention the other executives). I guess it is easier to fire the servo/rust people who did actual work rather than any of the designers or the higher ups.
- deleted 6y ago
  [deleted]
- MaxBarraclough 6y ago
  This also turned up in the other Mozilla-related thread 12 hours ago: https://news.ycombinator.com/item?id=24129926 https://news.ycombinator.com/item?id=24129926
dangus 6y ago
I encourage you to learn more about business! I have found that process to be interesting for someone on the technical side. More tech people need to consider it and respect it, in my opinion. Basically, part of situation analysis is that you have to evaluate the future potential of your projects and where your investment dollars go. Businesses are always thinking of the future, and that includes non-profits. The Boston Consulting Group matrix is one tool that might fit this scenario: https://corporatefinanceinstitute.com/resources/knowledge/strategy/boston-consulting-group-bcg-matrix/ https://corporatefinanceinstitute.com/resources/knowledge/st... The scenario you describe might be analogous to this hypothetical example: let’s say Microsoft laid off its entire Microsoft Surface team, and simultaneously invested $10 billion into Microsoft Azure. You might think, what the heck, the Surface lineup are good products that seem to be profitable (I actually have no clue if they are). But, perhaps the Surface product line is a dog. It’s a low-market share product in a low-growth market. Azure might be a star: it has a large portion of a fast-growing market, and deserves more investment. Even though Mozilla is a non-profit, I think it’s clear that they are looking to diversify their income stream. The “fix the internet” incubator can probably come up with services in high-growth markets that are less costly to implement and more easily monetized than a web browser (and fit their organizational goal of improving the Internet).
lacker 6y ago
The Fix The Internet incubator doesn't look like very much money is involved. A $2500 stipend for participants, a top prize of $25,000, not that much money. Whereas layoffs of 250 people will save maybe $50 - $100 million a year. Of course, perhaps they will also cut future funding to this incubator, and it's just a different timing that they announce it.
- causality0 6y ago
  They're paying their devs 200-400 grand a year? Jesus.
  - dr_zoidberg 6y ago
    Not in just salaries, but that estimate would include all the costs associated with an employee.
  - kilbuz 6y ago
    Salary, bonus, healthcare, dental, 401K, office space, taxes, equipment, ... employees are not cheap. That figure would be competitive in the Bay Area for quality dev work.
    - deleted 6y ago
      [deleted]
    - overcast 6y ago
      I think I found the solution, not basing yourself in one of the highest cost of living areas.
      - owowow 6y ago
        Mozilla hires devs all across the world, many in countries where developers are much cheaper than in the USA.
        stingraycharles 6y ago
alexbanks 6y ago
Doing layoffs doesn't necessarily mean you don't have the cash to pay everyone, or even that you're not cashflow positive. Sometimes orgs do big layoffs amidst big hiring pushes, meaning they don't feel like their resources are allocated correctly. Sometimes layoffs are a part of bigger organizational restructuring (this is Mozilla), saying they want to emphasize certain parts of the business and downsize others. If layoffs weren't evenly distributed around the company (ie every org loses 5% vs. we just laid off all of x department), it can mean different things.
- throw_m239339 6y ago
  > Doing layoffs doesn't necessarily mean you don't have the cash to pay everyone, Sure but that's the case here.
  - alexbanks 6y ago
    Where did they say they couldn't afford to pay these people?

It's very weird that Mozilla is laying off 25% of its workforce while at the same time spending oodles of cash on its Fix The Internet incubator. I'm not a business major; maybe this is normal.

gkoberger 6y ago

I don't know the details, but the Mozilla Foundation and Mozilla Corporation have different budgets and legally have to spend the money on different things (since the Foundation is a non-profit). They can't just move money around like a normal company can.

Wowfunhappy 6y ago
Well... can they fix that? Please? At least for the future so this doesn't happen again? I'm not opposed to nonprofits creating systems to make sure donor money is handled appropriately, but it seems to me there's something seriously wrong with the current structure. In hard times, organizations generally need to focus on their core initiatives, not branch out even more!
- dboreham 6y ago
  Probably would mean paying $$$ tax and/or returning money to whoever donated it.
maxerickson 6y ago
The corporation can spend money on whatever the hell. That's why they set it up. You can infer from the foundation tax returns that most of the assets are held by the corporation: https://assets.mozilla.net/annualreport/2018/mozilla-2018-form-990.pdf https://assets.mozilla.net/annualreport/2018/mozilla-2018-fo... It's the assets held directly by the foundation that have implications for their tax status, and they only move assets to that status as necessary.
- viro 6y ago
  "The corporation can spend money on whatever the hell. That's why they set it up." oh that is not true at all ... fiduciary duty doesn't work like that.
  - maxerickson 6y ago
    There's no need to be so literal. And conveniently, the people directing the Corp are the ones setting the agenda for the org (which that agenda is the thing the Corp has a fiduciary duty towards...).

welfare 6y ago

As someone who's been involved in setting up a corporate incubator, this is a pretty common dilemma. The way that we viewed it at my previous company was basically it's two different businesses, two different P&L's and two different sets of metrics and KPIs. You could see them as two different business units that can succeed or fail independently. If one Business Unit is struggling, you can't just fill the holes by taking funds from another BU to fill the gap. You need to solve the inherent profitability problems in the struggling Business Unit in some other way, typically by selling more, increasing the price/mix or reducing the cost. Don't know if this is how Mozilla reasons, but this was definitely the way we reasoned in the last two large corporations I worked for.

manquer 6y ago
That doesn’t work in a non profit contexts . Most non profit missions are well, not profitable in the first place. While the Mozilla corporation is for profit entity , the goals of the foundation and reason Mozilla foundation /corporation exists is not to make or maximise profit . Non profits generally run on the principles of sustainability I.e are they spending more than endowments or they drawing on the principal amount etc. In Mozilla case drop in revenue/ donations resulting in cancelled projects is per se not abnormal , but which projects are shelved depends on how the mission is interpreted. It is perfectly within the foundation remit to infuse capital into the corporation if they had more money and they also believed the work of the corporation is more important than some foundation projects to the overall foundation’s mission. Just like NASA cancels other projects when one project like JWST goes a lot overbudget , with approvals from congress if required . Clearly the foundation did not think corporation projects were worth saying over others , we can debate that , but they did and do have that choice

NoInputSignal 6y ago

I remember reading another comment on HN somewhere that broke down how project costs are different from employee costs. Something to do with employees being recurring expenses vs projects being somewhat fixed....I'm not going to do it justice. If I find the comment I'll link to it.

rebelwebmaster 6y ago

If revenue from Firefox isn't enough to pay the bills anymore, then not funding R&D is cutting off your nose to spite your face.

pbhjpbhj 6y ago
'revenue' from Firefox was never enough. It's only really just struck me that of course Google funding them made a dependency and 1) made the company grow beyond its needs, and 2) made it not seek self-sufficiency. If Google are stopping the money then FF is like a person with no money taken in by Google and hooked on drugs; once they're kicked out they can't fund the habit and reliance on Google has meant they've not had to find ways to fund themselves. I realised Google held the cards, but hadn't twigged on how the excessive nature of the funding made Firefox/Mozilla weaker. Unless FF were aware of how that might go and put half of their Google money into investments?
- tw1423214 6y ago
  It's not true that "'revenue' from Firefox was never enough", and it's bordering on misinformation to speculate that "Google are stopping the money". edit: Really, could you please not do that? Asking "Is the search deal not expiring?" is even worse than the earlier comment...
  - mulmen 6y ago
    Is the search deal not expiring? e: to your edit. I'm not sure what is wrong with the question. My understanding is that the search deal is expiring and is the source of most of the FF related revenue. If that is not the case I'd like to know. It seems like a reasonable question.
    - Arnavion 6y ago
      The search deal is indeed expiring in a few months, but also neither party has said whether it'll be renewed or not, so it's not yet time to assume it won't be.

deleted 6y ago

[deleted]

mathattack 6y ago

Different people. Fire one side to fund the other. Many companies use COVID as an excuse to get rid of management mistakes too.

dylan604 6y ago
Too bad it's not "mistakes in management" getting fixed instead
- mathattack 6y ago
  Management can have high turnover too. Imagine trying to explain away being head of strategy at a company that drove into a ditch.

deleted 6y ago

[deleted]

behnamoh 6y ago

As a company, you know you're doing something wrong when websites such as this pop up on HN. I hope Mozilla is able to turn back to its origins.

lmm 6y ago
What origins? Was Mozilla ever a focused, well-run organisation?

blihp 6y ago

Fixing the browser revenue is at best difficult (i.e. significantly increase market share, more hard work to do on the browser which will cost $$$ for labor) while the Fix The Internet initiative could result in a miracle that saves them. Management often opts for for the miracle.

jacquesm 6y ago
Which then predictably doesn't happen and then we all get to buy Aeron chairs at a discount.
- ThreeBadMoz 6y ago
  It's too bad all of us commenter's dick isn't getting sucked in this whole procedure; cannot catch them all.

dependenttypes 6y ago

Or spends 2.5m just for its CEO yearly (not to mention the other executives). I guess it is easier to fire the servo/rust people who did actual work rather than any of the designers or the higher ups.

deleted 6y ago
[deleted]
MaxBarraclough 6y ago
This also turned up in the other Mozilla-related thread 12 hours ago: https://news.ycombinator.com/item?id=24129926 https://news.ycombinator.com/item?id=24129926

dangus 6y ago

I encourage you to learn more about business! I have found that process to be interesting for someone on the technical side. More tech people need to consider it and respect it, in my opinion. Basically, part of situation analysis is that you have to evaluate the future potential of your projects and where your investment dollars go. Businesses are always thinking of the future, and that includes non-profits. The Boston Consulting Group matrix is one tool that might fit this scenario: https://corporatefinanceinstitute.com/resources/knowledge/strategy/boston-consulting-group-bcg-matrix/ https://corporatefinanceinstitute.com/resources/knowledge/st... The scenario you describe might be analogous to this hypothetical example: let’s say Microsoft laid off its entire Microsoft Surface team, and simultaneously invested $10 billion into Microsoft Azure. You might think, what the heck, the Surface lineup are good products that seem to be profitable (I actually have no clue if they are). But, perhaps the Surface product line is a dog. It’s a low-market share product in a low-growth market. Azure might be a star: it has a large portion of a fast-growing market, and deserves more investment. Even though Mozilla is a non-profit, I think it’s clear that they are looking to diversify their income stream. The “fix the internet” incubator can probably come up with services in high-growth markets that are less costly to implement and more easily monetized than a web browser (and fit their organizational goal of improving the Internet).

lacker 6y ago

The Fix The Internet incubator doesn't look like very much money is involved. A $2500 stipend for participants, a top prize of $25,000, not that much money. Whereas layoffs of 250 people will save maybe $50 - $100 million a year. Of course, perhaps they will also cut future funding to this incubator, and it's just a different timing that they announce it.

causality0 6y ago
They're paying their devs 200-400 grand a year? Jesus.
- dr_zoidberg 6y ago
  Not in just salaries, but that estimate would include all the costs associated with an employee.
- kilbuz 6y ago
  Salary, bonus, healthcare, dental, 401K, office space, taxes, equipment, ... employees are not cheap. That figure would be competitive in the Bay Area for quality dev work.
  - deleted 6y ago
    [deleted]
  - overcast 6y ago
    I think I found the solution, not basing yourself in one of the highest cost of living areas.
    - owowow 6y ago
      Mozilla hires devs all across the world, many in countries where developers are much cheaper than in the USA.
      - stingraycharles 6y ago

alexbanks 6y ago

Doing layoffs doesn't necessarily mean you don't have the cash to pay everyone, or even that you're not cashflow positive. Sometimes orgs do big layoffs amidst big hiring pushes, meaning they don't feel like their resources are allocated correctly. Sometimes layoffs are a part of bigger organizational restructuring (this is Mozilla), saying they want to emphasize certain parts of the business and downsize others. If layoffs weren't evenly distributed around the company (ie every org loses 5% vs. we just laid off all of x department), it can mean different things.

throw_m239339 6y ago
> Doing layoffs doesn't necessarily mean you don't have the cash to pay everyone, Sure but that's the case here.
- alexbanks 6y ago
  Where did they say they couldn't afford to pay these people?